Unilever adds cake mix to Stork despite plans to sell the brand

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Dive Brief:

Unilever has launched a range of chilled cupcake mixes under its Stork brand just weeks after it announced the unit, part of the company's spreads business, would be sold, says Food Navigator.

The new product lines could be a way to increase the brand's value as it prepares for a sale.

The cake mixes come in three flavors: lemon, chocolate and classic. It is intended for those who lack the confidence, skills or time to bake. It can be poured directly from the pouch into cupcake cases, leaving customers “with more time for the fun part – decorating and tasting”, said Stork’s brand manager at Unilever UK, Pedro Costa.

Dive Insight:

The baking mix category is in steep decline in the United States, posting a 3.4% fall in sales in 2015. Mintel predicts it will continue to contract at this rate into 2020. As baking sales decline in the U.S., and increasingly busy consumers have less time in the kitchen, Unilever could be wise to find a way to draw more people into the kitchen.

However, the story is different on the other side of the Atlantic. In the UK, the market researcher found launches of bakery ingredients and mixes posted 100% growth from 2009-2012, 40% of which carried “ease of use” claims as of 2012. Germany accounts for 17% of new product activity in the baking mix category in Europe, followed by the UK (14%), France (13%) and Italy (10%).

Given the timeline for new product development, Unilever must have had these products in the pipeline before its ailing margarine business was earmarked for sale. The new Stork product could be a way to add value to the division ahead of a divestment that could sell for more than $7 billion.

The margarine division represents about 4% of Unilever’s revenue and was split off into a subsidiary in 2014. The Anglo-Dutch giant represents about a third of the global margarine market and analysts have suggested that Kraft Heinz could be a potential buyer for the unit. Unilever rejected a $143 billion takeover offer from Kraft Heinz in February.